From Morningstar:

Airbus experienced a significant increase in aircraft deliveries in January 2024, delivering an estimated 32 planes, driven primarily by 27 new A320/321 aircraft. This rise came as a recovery from production challenges in 2023, but supplies of aircraft components remain tight.

Morningstar equity analyst Nicolas Owens has high expectations for Airbus, anticipating guidance for 2024 close to or above the previous record of 864 planes delivered in 2019. Owens will be closely watching for any effort from Airbus to increase supply chain growth for faster production of the A320s.

In the wake of two fatal crashes of Boeing 737 MAX 8 aircraft, Boeing has faced severe consequences and is working to resolve the manufacturing issues that have occurred with its new 737 and 787 jets. There is also a requirement for rigorous inspections before 171 Boeing MAX 9s can fly again.

Owens has set Airbus’ fair value estimate at €160, with a Morningstar 3-Star territory stock rating. This pricing is based on the anticipation of a margin-accretive narrow-body aircraft ramp-up post-pandemic.

Analysts at Stifel and BofA Global Research are confident in Airbus’ position, while analysts at UBS are more skeptical citing managerial costs and inflation as potential concerns.

It is important to note that the stock is currently trading in Morningstar 3-Star territory. Airbus has set the estimate for adjusted EBIT for Q4 at €2.1 billion, and Stifel expects the company to guide for about 800 deliveries and an adjusted EBIT of €7 billion in 2024, in line with consensus estimates.

UBS analysts raise concerns about operating leverage, while BofA Global Research is confident that Airbus is positioned for mid-term margin expansion driven by the A320 family and the A350, counter to UBS’ skepticism.



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